Miner BHP Billiton has posted the biggest interim profit in Australian corporate history.

It has announced a half-year after tax profit of $5.9 billion, a rise of almost 48 per cent from last year.

Revenue is up 16.3 per cent after record production volumes for aluminium, copper, nickel and gas.

It says it will return billions of dollars to shareholders over the next 18 months, including a $1.5 billion off market buyback of its Australian listed shares.

Chairman Don Argus says the board's confidence in the company's outlook and strong cash generative capability has underpinned its decision.

"This is now the second consecutive year in which we will have undertaken a $2 billion capital management initiative," he said.

"Given the company's financial strength, we are well positioned to fund our $US14.4 billion pipeline of projects and other value enhancing opportunities as they arise, maintain BHP Billiton's robust capital structure and continue with our progressive dividend policy, as well as make this $2 billion return, in line with our stated priorities for use of the company's cash flow.

"All shareholders in BHP Billiton Limited and BHP Billiton Plc, including those not participating in the buyback process, regardless of location and tax status, benefit from an off market buyback."

He says purchase of shares at a discount of at least 8 per cent to the market price allows the company to buyback a greater number of shares than is possible in an on market buyback for the same total cost.

"The value of the remaining shares will therefore be enhanced through the increased earnings, cash flow and return on equity attributable to each share," he said.

Chief executive Chip Goodyear says the result has been driven by continuing strong demand for commodities.

"We've seen some two or two-and-a-half-years of rising raw material prices, the things that we sell," he said.

"Needless to say that will come through on the cost side, particularly the demand environment that we're in today."